Entravision to Acquire 3 Stations From Rival Broadcaster

Entravision Communications Corp., one of the nation’s biggest Spanish-language broadcasters, agreed to buy three Los Angeles radio stations for an estimated $137 million in cash and stock, the company said Tuesday.

The Santa Monica-based firm expects to purchase KLYY-FM, KVYY-FM and KSYY-FM from Big City Radio Inc., pending regulatory approval. Big City, based in Hawthorne, N.Y., said last month that it planned to auction the stations to pay debt and other liabilities.

The move solidifies Entravision’s position in the country’s top Spanish-language media market at a time when advertisers have put a premium on Latinos. If the deal is approved, the company would control six FM stations in the market.

Analysts called the purchase a daring step, given regulators’ focus on consolidation in Spanish-language media. Justice Department officials have been reviewing a plan by Univision Communications Inc. -- which owns a 31% stake in Entravision -- to buy the nation’s biggest Spanish radio chain, Hispanic Broadcasting Corp.

The government has been trying to determine whether Univision has taken the reins at Entravision, which is the biggest owner of Univision TV affiliates. To try to assuage regulators, two senior Univision executives resigned in August from Entravision’s board.

But regulators also are expected to force Univision to divest radio stations in markets where Entravision competes with Hispanic Broadcasting, including Los Angeles.

In a statement, Entravision Chairman Walter Ulloa said buying the Big City stations would let his company expand distribution of its “Super Estrella” pop-music format. Ulloa added: “We also expect to benefit from Big City’s exit from the Los Angeles market.”

Shares of Entravision fell 35 cents to $10 Tuesday in New York Stock Exchange trading.